Officials from the United States Department on Housing and Urban Development are scheduled to visit Chapel Hill on Wednesday.

This comes after the town graded out at 52 out of 100 possible points during a semiannual evaluation of the town’s public housing by the federal agency in late 2017. The score left Chapel Hill in the “Troubled Performer” category of HUD rankings.

The letter and scheduled visit from HUD led to what town manager Roger Stancil described as “rumors” in an email to the Town Council.

“We know no basis for the rumors that HUD will take over our housing department or the rumor that the Town has known of this possible outcome but has sat on remedies [because] it welcomes the designation so it can get out of public housing management,” Stancil wrote.

Town staff wrote that it was believed that three factors led to the low score from HUD:

  1. Transference of tenants from Trinity Court because of its condition leaving 40 units vacant

  2. Audit irregularities that have since been cleared up by our staff accountant

  3. Failure to disburse 100% of all grant funding before its disbursement end date.

Chapel Hill Mayor Pam Hemminger said that all of the town’s grant funding had not been spent as of the HUD evaluation visit because the town was working to move residents out of the soon-to-be-renovated Trinity Court apartments and into new public housing options, which also led to the high number of vacant apartments at Trinity Court.

“This was just a timing issue,” Hemminger said. “This one will be resolved very quickly. Again, in order to do these kinds of renovations, we had to get these families out of there.”

Hemminger also said that there was no truth to the “rumors” that HUD would be taking over the town’s public housing.

“There’s been concern that HUD was going to come over and take over the project,” Hemminger said. “That’s not what they’re coming over to do. They’re coming over to verify that we still have the funds to do the project – we just didn’t draw them down in the time frame; that we are going to do the project – we have everything ready to go. Again, it was timing.”

Town staff said that HUD officials had been scheduled to come to Chapel Hill on three occasions since receiving the “Troubled Performer” designation but that all three had been canceled due to inclement weather. The visit is part of HUD’s quarterly visits to sites, according to the town, and is to advise staff on new reporting software and is not related to the recent designation.

The email to the Town Council said that crews had embarked on “an ambitious renovation schedule for the next 6 to 8 weeks to encumber much of the funding designated” from previous fiscal year grants.

The town will be required to submit a recovery plan to HUD.

The Town Council is also scheduled to receive a consultant’s report on the town’s Public Housing Master Plan at a meeting on May 2.